Former Justice Verniero: Pension Ruling is ‘Significant Opinion’

NJ Spotlight News | June 10, 2015 | Politics

The pension ruling has been called “one of the most consequential financial decisions of the state Supreme Court in modern history.” That quote from former New Jersey Supreme Court Justice Peter Verniero. He told NJTV News Anchor Mary Alice Williams that the ruling from the state Supreme Court is a very significant opinion.

“This is a very significant opinion of the Supreme Court because there simply aren’t a lot of financial decisions like this one,” said Verniero. “Here the Court basically set the rules for the budget process for years to come.”

According to Verniero, the state Supreme Court had not been involved in any budget negotiations before, not in terms like the pension ruling. He said that there was concern of the Court over the decision because it did not envision inserting itself into the budget process.

Verniero said that the ruling could have gone the other way because both sides were well reasoned and well written. He said the opposite decision would have been a very significant ruling as well.

He also said that the Court did not say that the statue in 2011 was unconstitutional, nor did the Court say that pensions can go unfunded.

“The Court simply said that the chosen method under this particular statute was not binding because of other sections in the state Constitution,” Verniero said.

For the case to head to the U.S. Supreme Court, Verniero said that the first challenge for the plaintiffs would be to urge the Supreme Court to accept and hear the case.

“That’s not an automatic process. The United States Supreme Court each year receives about 10,000 petitions,” said Verniero. “They accept about 80 of those, less than 1 percent. So assuming they get over that hurdle, they would have to persuade the United States Supreme Court that there was a contract formed in this case and that it was violated. What the New Jersey Supreme Court said was there was no contract formed in this case because of the appropriations clause and the debt limitation clause.”

When asked what’s next for the case, Verniero said that the Court suggested the Legislature could submit the issue to voters, which would remedy the debt limitation issue. He also said that the Legislature could appropriate the amounts and the governor could withhold or agree with those appropriations. The Constitution could also be amended, but Verniero said that’s a difficult process.

Verniero said that the the only legal option would be the U.S. Supreme Court and that it’s a difficult process.

“Odds are that the Court won’t take it,” he said. “That’s just because of the numbers that I just recited, but there’s always a chance. But that’s a long shot.”

Related: Unions Urge Legislators to Fully Fund Pensions, Override Expected Christie Veto

We’re in this together
For a better-informed future. Support our nonprofit newsroom.
Donate to NJ Spotlight